InvestIdeas

ECB's Trichet: low inflation for 10 years

"In the coming 10 years, the inflation rate will most probably stay very low; current expectations are for around 1.8 percent," he told the mass-selling Bild am Sonntag newspaper, in one of the final interviews of his term heading the ECB.

"This means: in the euro zone we have price stability. This is something we are very proud of, and rightly so, because we have achieved what is expected of us."

"We should be very aware of the fact that some ways of behavior on markets caused considerable irritation. One such thing is the level of some bonus payments," Trichet said.

"Banks must raise their level of resistance and avoid behavior that is not in cohesion with the values of our society -- including excessive bonus payments."

He called for stronger European governance, making it possible to implement the necessary measures in those countries that continuously contravene the stability criteria and endanger the financial stability of the euro zone.

Source: Reuters US Online Report Business News

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Traders said the European Central Bank increased its bond buying, but the ECB's hard-line chief economist told governments not to expect the bank to rescue them with unlimited funds.

A pullback in Italian bond yields helped support sentiment.

Source: Reuters

European Central Bank Steps in to Counter Bond Rout

ROME/ATHENS (Reuters) - The European Central Bank stepped in to stem an accelerating sell-off of euro zone government bonds on Wednesday, traders said, after the United States called for more decisive action to halt a spreading sovereign debt crisis.

http://www.newsmeat.com/news/meat.php?a ... &buid=3281

So, how's the bond sales going today (or is it tomorrow)?

i think it will depend on what the new PM/FM says

Even chance ECB to start printing money: Reuters poll by Ana Nicolaci da Costa

LONDON (Reuters) - The European Central Bank could soon bow to pressure to print money , to prevent a further escalation of the euro zone's debt crisis, with respondents in a Reuters poll giving an even probability, the ECB would adopt a policy of quantitative easing.

That would be a highly controversial break from its existing policy, where it offsets government bond purchases in its Securities Markets Programme by draining liquidity from the system in separate operations.

Of those who predicted the ECB would start QE, as the Federal Reserve and the Bank of England have done, a majority said it would happen by March 2012.

The ECB has reluctantly carried out its bond-buying program since 2010, totaling 187 billion euros so far. But it has shown little sign of shifting into a higher gear even as countries like Italy risk being shut out of commercial markets.

Printing money to buy bonds outright in the secondary market -- the ECB is not allowed to buy directly in auctions -- could push up euro zone inflation, which at 3 percent is already higher than the ECB's 2.0 percent target ceiling.

Source: Reuters US Online Report Top News

http://www.newsmeat.com/news/meat.php?a ... &buid=3281

When will they start cranking up the printing press ?

Credit Suisse issued a report on the state of the EU:

We seem to have entered the last days of the euro as we currently know it. That doesn't make a break-up very likely, but it does mean some extraordinary things will almost certainly need to happen – probably by mid-January – to prevent the progressive closure of all the euro zone sovereign bond markets, potentially accompanied by escalating runs on even the strongest banks.

The increasingly bearish European comments from major banks and investors are simply a call to the European Central Bank to monetize.

We'll see that happen soon.


Source: Growth Stock Wire